Crafting Intuitive Customer Engagement to Increase Retention
How can brands form a continuous customer loop? Jason Smith, VP of MoEngage Europe, emphasises the importance of understanding customer behaviour, leveraging data insights so customers are not only delighted but moved to become advocates.
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In an ideal scenario, designing a business would involve a comprehensive understanding of data and the complete customer journey. The goal would be to create an experience where customers don’t visit a shop just once but become frequent visitors. But what is the biggest customer challenge that hinders higher retention rates?
According to Jason Smith, VP of MoEngage Europe, it’s the difficulty in implementing or comprehending data-led and customer engagement strategies. This struggle persists across various sectors and company sizes.
Smith recommends focusing on low-end metrics and identifying pain points in the acquisition funnel for improvements. He also advocates for reactive strategies based on historical data analysis and leveraging technology to orchestrate customer journeys effectively.
The engagement challenges
Consider a business organisation with several departments. While each team comprehends their individual strategies, the challenge lies in aligning these efforts to achieve the overarching objective of driving sales, acquisitions and retention.
“Each one understands the individual team strategy, but bringing it all together for the ultimate business goal is always the challenge. Implementing a cohesive combined strategy is the biggest issue,” said Smith.
Data silos are another element of the challenge. The evolution of data has taken us from a time of scarcity to an era of abundance, leading to the existence of data silos. Data flows incessantly across various aspects, from customer acquisition to loyalty, retention, and lifetime value (CLV).
“It’s possible that companies that have surplus data are looking at it from the wrong angle. It can have a negative effect as well. You need to observe and analyse the possible impact.” A unified organisational approach towards the ocean of data is necessary.
The game of metrics
The next step is to use the right measurement tools to get the most accurate data insights. There are specific metrics that businesses do not fully grasp, but they often prove to be the most influential drivers of change. Despite their apparent simplicity, they hold substantial power to bring about significant transformations.
“Most people focus on top-end metrics such as customer lifetime value. But it’s imperative to understand the acquisition funnel first.
- Where are people dropping off?
- Where are you losing money?
- How can you fix those pain points?
They might not have bought from you yet, but if you’ve got a leaky bucket, fill the holes first, and the bucket will fill quicker. “
After a thorough re-evaluation of the acquisition strategy come the retention metrics. To drive better engagement and retain customers, it’s crucial not to annoy them. For which, an intuitive customer engagement strategy can help.
“This strategy will increase retention, which in turn will affect the customer lifetime value and also make customers recommend the brand to peers,” added Smith. Thus triggering the acquisition strategy again and forming a continuous customer loop.
Within this loop is a customer engagement strategy that encompasses personalisation. Now, customers don’t mind personalisation until it’s relevant. Even to create the most suitable personalisation strategy, data and metrics play a critical role.
“Moreover, customers change over time. They don’t stay in the same customer segment type forever. They might once be super engaged, but soon it changes. “That’s the best time to choose AI-driven metrics, understand data in real-time, identify the pain points and win them back before it’s too late.”
By leveraging AI-driven analytics, companies extract valuable customer insights, enabling them to anticipate subsequent actions. For instance, by leveraging AI, one understands customer channel preferences, identifies the optimal timing based on specific goals, and pushes the needle towards higher retention.
“Use AI as a personal shopper who observes and understands the customer. For instance, if you want people to click on something and see something or improve cart value, you need to pick the right time, and AI analytics can help garner those insights about when the customer is more likely to browse,” said Smith.
According to Smith, now is the moment to dispel the excessive hype surrounding AI and recognise it for what it truly is—an invaluable tool for comprehending customer behaviour and gaining insights.
Complete it with a reactive customer engagement strategy and unified data, and businesses can become strategic organisations that illustrate long-term success.
